NEWS

NEWS

WHY Cloud is Eating Software

October 7. 2016 | Thomas DelVecchio, Founder + Director of Research

In an op-ed piece authored for The Wall Street Journal in August 2011, Mark Andreessen deftly stated "Why Software is Eating the World." Five years later, one could presuppose that now Cloud is eating Software.

In preparation of a talk we gave at The Channel Co.'s Midsize Enterprise Summit last month, we posed to our CIO community why and how public cloud is disrupting their IT architectures. Two of the responses were quite enlightening and well encapsulated the phenomenon (below).

[ Regarding innovation ], AWS comes to the top of the mind on this… IT departments now can move at the speed of sound when it comes to procuring infrastructure services. The old traditional COLO models will have their place until legacy applications go either SaaS or PaaS. My conversations with our applications providers is all around when and not if are you going to offer this as a Service. If no plans for when then we are changing our buying decisions. Hurt are all these legacy providers that hold onto branded infrastructure. Customers don’t give a s@*t if its HP, Dell, IBM – just need it to work reliably. The next revolution is Network as more and more things become geographically Cloud disbursed. The Broadband bust was 15 years ahead of its time – the IT infrastructure community wasn’t ready then – they are now.

— IT Director of Strategy and Planning at Energy & Utilities Firm

Cloud Computing is at a clear inflection point. Components like bandwidth, silicon, security protocols and other key technologies are enabling this cloud movement. I often think of it as the ‘Replatforming of Enterprise Technology’. And no part of that technology stack is safe from disruption.

The sheer impact of the monoliths of the enterprise technology landscape, beginning to leverage the same agility and available velocity to build, test, migrate and scale infrastructure, on the cloud - so definitive to the startup tech ecosystem - is already sending shockwaves, equally, towards the old infrastructure and the new.

— Elizabeth Hunker, EIR at ETR + aptiviti

Further, as we now mine and analyze the 36,030 data points gathered from the 739 CIO respondents over the last three weeks, it becomes very apparent from a multi-year perspective which of the 25 sectors we track is growing while many have flattened or declined among the F100 and F500... Cloud Computing / Managed Hosting.

Further, when we utilize cluster and link analysis to identify which sectors over time are gaining the most enterprise wallet and market share among our most forward thinking CIO community members - its staggering how positive Cloud Computing / Managed Hosting stands out.

We’re gradually shifting a lot of our software from VMs to containers and in some cases server-less platforms (Lambda) to further reduce the costs of infrastructure overhead and capacity we don’t (can’t) fully utilize. We would never be able to do the required platform engineering ourselves – but we don’t have to. Amazon and Microsoft do it all for use. Next steps will focus on rationalizing storage (where Amazon’s ambition to be the Master Reference Data source for everything is a major element of our strategy).

— CEO at Entertainment Firm

Public Cloud disruption is not hard to understand, CIO’s gain flexibility & agility; they can offer more new products, at a faster pace since they are don’t feel the provisioning friction of asset staging, and if the new products work, they scale quickly without retrofitting and if they die the CIO is not burdening internal resources managing under-utilized / idle assets.

— Robert Stevenson, ETR Chief Technology Strategist

In developing an algorithm which quantitatively identifies shifts in IT architecture, we were able to pinpoint which enterprise technology sectors and vendors would be most affected by public cloud architecture. The findings reveal that few sectors will be immune to the redirection of spend being driven by public cloud adoption.

— Sagar Kadakia, ETR Head of Data Science

IT departments want the agility of the cloud because it could translate to their company capturing opportunity they otherwise couldn’t waiting for a server and some storage.